Although the conversion market is often overlooked, it still represents an important cost
component of nuclear fuel, and all costs will receive more scrutiny in a more competitive
electric industry. UxC's annual Conversion Market Outlook report is invaluable for
identifying those forces influencing the market and analyzing supply, demand and
From 2003 to 2005, spot conversion prices increased 150% in the wake of the Metropolis plant shutdown,
a strike at Port Hope, Tenex’s termination of the HEU feed contract with GNSS, and the announced
shutdown of the Springfields plant. Since then, the North American plants came back online, Tenex
supplied replacement contracts, and Cameco and BNFL entered into an agreement to extend Springfields
output for ten years (through 2016). Demand for conversion is also falling as utilities opt for lower tails assays
in an environment where feed prices increased dramatically over the past several years.
Does this mean we're out of the woods?
Not exactly. The market is expected to be vulnerable over the next several years as inventories
have been worked down to low levels following the disruptions. More recently, however, additional
problems continue to appear in the conversion market such as the extended outage at Port hope.
Transportation packaging requirements and costs have increased, and new investment must be made in
conversion capacity. (Here the situation is somewhat similar to enrichment, where both additional
and replacement capacity are needed.) Thus, the market is clearly in a transition phase, with
important implications for buyers and sellers alike.
With transportation difficulties, capacity questions, regional price disparities, and recent
disruptions to secondary supplies, conversion services can no longer be viewed as a minor concern.
Fuel managers need to understand the worldwide supply and demand picture for the next decade in order
to make the right choices now.
UxC's bi-annual Conversion Market Outlook report incorporates all of these events and provides a thorough
supply-demand analysis and price forecast for conversion services.
Please contact Eric Webb (see below) for details.
Please see our product flier in Adobe Acrobat PDF format.